Could Twitter Price As High As $28?

By Dimitra DeFotis

Underwriters say Twitter could price even higher than anticipated – at between $25 to $28 per share.

That’s above the stated price range of $23 to $25 expected heretofore. And that was already upped from $17 to $20 Monday. The Wall Street Journal cites fund managers briefed by Goldman Sachs and Morgan Stanley bankers, two of the banks underwriting the deal, in saying the new pricing range is $25 to $28. Twitter starts trading as TWTR on Thursday.

The company has not yet made a final decision, though pricing occurs after the close today. More from WSJ here.

Sterne Agee analysts Arvind Bhatia and Brett Strauser estimate that at $27 per share, Twitter would trade at a pro-forma multiple of 2013 enterprise value to sales of 26.8 times, while high-growth peers including Facebook (FB), LinkedIn (LNKD) and Yelp (YELP) trade at 16.5 times 2013 estimates.

“Anyone who bashes Twitter because it’s “losing money” or “is like Facebook ” or hasn’t “proven anything” is the most dangerous form of market pundit,” writes Henry Blodget in Business Insider. “[Because] some of the smartest investors in the world are so excited about Twitter.”

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Tech Trader Daily is a blog on technology investing written by Barron’s veteran Tiernan Ray. The blog provides news, analysis and original reporting on events important to investors in software, hardware, the Internet, telecommunications and related fields. Comments and tips can be sent to: techtraderdaily@barrons.com.